The impact of airline service failures on travelers' carrier choice: a case study of central Iowa.

Abstract

Understanding air travelers' carrier choices is an important issue for airline managers. Using the survey data recently collected in central Iowa, this article examines how travelers' airline choices are affected by their past service failure experiences (e.g., seat denials or considerable flight delays) with the candidate airlines. The effects of service failure experiences on traveler choice probabilities are estimated separately for business and leisure travelers, and by type of service failures (seat denials, flight delays, and baggage mishandling). The results indicate that, for both business and leisure trips, travelers' airline choices may not be affected by any service failure experience. This condition implies that, in each trip occasion, travelers may choose the airlines that maximize their utilities without regard to past service failures. Although this behavioral pattern may seem somewhat counter-intuitive, it is consistent with the random utility theory.

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